Supply chains evolve drastically with business growth. Products often need to pass through a dozen hands from the factories, shipping vehicles, distributor warehouses, retail warehouses, shops, delivery fleets, and finally, the end-user.
The products travel thousands of miles and go through multiple intermediaries, adversely impacting the profit margins and the brand’s ability to serve and communicate effectively with the customer.
Customers are also constantly changing demands, and now they want to get their products immediately after they purchase them. Companies striving to offer same-day and next-day deliveries should look for ways to remove the middleman for fast delivery speeds. Speed dictates the success of online purchases. Such high expectations prompt the need for a direct-to-consumer business model.
What Does Direct To Consumer (D2C) Mean?
The traditional supply chain process involves goods coming from the supplier, then moving from the manufacturer, wholesaler, distributor, and lastly, the retailer who sells the finished products to the end-user.
This sales model is slow and requires lengthy negotiations at every stage of product delivery. The modern customer is all about speed and convenience, making such long processes unhealthy with the stiff competition online.
Direct to consumer ignores the sales model process used by the traditional supply chain where goods come directly from the company to the customer. Companies will cut out the middleman, wholesalers, distributors, and retailers and harness the power of cloud and eCommerce to sell products directly to their customers.
Launching new products and boosting sales is effortless as you control the process. You have more time to make proper marketing decisions, control your brand story, and offer excellent customer service.
Technology Is Boosting Direct To Consumer Sales Model
The fast evolution of technology and its application in last mile delivery effectively speeds up the process. The current boom of eCommerce and the ease of launching online stores require a direct-to-customer model. Digital brands can work with delivery partners if they don’t own an in-house fleet to deliver goods to customers conveniently.
With last mile delivery and order fulfillment solutions, brands can now channel their products directly to customers and enjoy the advantages of owning the end-to-end experience. According to Forbes, over a third of customers report that they are willing to purchase from companies that offer fast and reliable direct services.
Benefits of Direct To Consumer
There are many benefits to switching directly to consumers. It is effective for any business looking to launch new products or have existing retail partners. By eliminating the various companies between you and your customers, you are removing any entities that take a cut of your profits.
Also, it enables you to connect with your customer, and your relationship becomes direct instead of relying on third parties. The close relationship will allow you to listen to your customer demands seamlessly and optimize your operations to satisfy them.
At Elite EXTRA, we help companies optimize their last mile delivery using our top-rated dispatch software. Highly advanced software will enable you to take control of your delivery process and optimize it for the future. Talk to us today to get started.
Resources:
https://www.forbes.com/sites/steveolenski/2016/10/10/why-direct-to-consumer-brands-should-think-twice-before-outsourcing/?sh=31551c98750d
